Chairman’s Review
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t is with grea t pleasure that I rep o r t on Gold Corpo r at i o n ’ s collection. Some 2.2 million coins,including 9000 Silver I ach i e vements in 1999-2000, one of the most exciting yea r s Kilo Olympic Masterpieces, were sold during the year, in the 101-year history of The Per th Mint. bringing total Program sales since October 1997 to 4.2 million,the highest sales of any Olympic collector coin The year opened in the midst of the Mint’s Centenary program. celebrations. As the year progressed,the Mint’s Centenary and Millennium coin issues won wide acclaim,sales of A significant achievement in 1999-2000 was the Mint’s Sydney 2000 Olympic coins topped 4 million,production of success in the 2000 WATourism Awards, in which it won a gold and platinum coin blanks destined for overseas markets record three categories,this being the first time in the totalled 2.3 million,and the decision was made to expand 28-year history of the awards that an organisation had won the Mint’s production facilities by constructing a new that many categories.The Mint is now a national finalist in building on the Goderich Street frontage. the categories of Retail Tourism,Heritage and Cultural Tourism and Promotional and Marketing Campaigns in the Importantly,The Perth Mint won international acclaim for Australian Tourism Awards to be announced in November. the high quality of design and production of its range of collector coins and for innovative marketing of its products GoldCorp Australia had a very good year, with strong sales worldwide. of collector coins exceeding early expectations. Full advantage was taken of widespread interest in the new Gold Corporation realised a record operating profit for the Millennium and in the Lunar Year of the Dragon to produce year of $7 million before statutory contribution. This popular commemorative coin issues. Substantial sales of 1 compares with the operating result of $6.5 million in 1998- gold and platinum coin blanks also boosted the division’s 1999 before bringing to account the abnormal profit result. realised in that year from the establishment of the AGR Joint Venture.The net profit for 1999-2000 was $4.1 million after The Perth Mint Depository Service and Certificate Program statutory contribution in lieu of income tax of $2.9 million. again exceeded budget expectations,despite stagnant international interest in precious metals investment.The A further highlight of the year was The Perth Mint’s Program aims to attract international investment in involvement in producing the Sydney 2000 Olympic and Australian precious metal bars and legal tender coins,which Paralympic Games victory medals,the most prestigious of are stored at the Mint on behalf of investors. all minting commissions. This assignment was shared with the Royal Australian Mint in Canberra,with The Perth Mint In its first full year of trading, the Australian Gold Refineries having the honour of producing the gold Olympic medals. Joint Venture, jointly owned by the Western Australian Mint This,together with the highly acclaimed Sydney 2000 and Golden West (Australasia) Pty Ltd,consolidated its Olympic Coin Program,brought considerable national and position as the leading refiner of precious metals in the Asia international publicity and further enhanced the Mint’s Pacific region.The Newburn refinery in Perth processed 246 reputation while arousing public awareness of its activities. tonnes of metal from domestic and imported material. The final 25 coins in the Sydney 2000 Olympic Coin The Board has decided to expand and upgrade the Mint’s Program were released during the year and a national road production facilities by the construction of an 8,400 square show was undertaken to promote the complete 53-coin metre, four level building next to the existing Perth Mint
Mr Les McCarrey CMG
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Chairman’s Review
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buildings.The $13.5 million building, which will also house Future growth is expected to come from a number of the sales administration,marketing and e-commerce sources. These include the Collectables division,launched in divisions,will relieve the congestion and severe pressures March 2000,The Perth Mint On-line Shop, launched in July under which the production staff have been working. 2000,and precious metal blank manufacturing contracts, following the establishment of new blanking lines in 2001. The Board and Management of Gold Corporation are Opportunities are also expected to arise from new conscious of their responsibility to preserve the distribution channels established as a result of the Sydney surroundings as well as the structure of one of Perth’s finest 2000 Olympic Coin and Medallion Programs. heritage buildings,and care has been taken to ensure that the new building harmonises with the adjacent Mint. Finally, I extend the Gold Corporation Board of Directors’ thanks to the Management and Staff of the Corporation who The new facility will allow the Mint to establish three have worked under intense pressure throughout the past separate precious metal blanking lines to meet the increased year to produce an excellent result in this memorable demand for gold and platinum blanks and to avoid cross Olympic year. contamination of metals,a recurring problem when several precious metal blanks are produced on the same equipment. The intention is to establish ‘state of the art’production facilities that will place The Perth Mint at the forefront of minting technology. It will also position the Mint to win a 2 greater share of blanking contracts from the major world L E McCARREY CMG mints,many of whom prefer to outsource their coin blank Chairman requirements. 1 November, 2000 The combined statutory contribution and dividend payment to the Western Australian Government will amount to $5.1 million. With this contribution,payments to the State and Commonwealth Governments since the establishment of the Corporation in 1988 will total $35.7 million. It is customary in the Chairma n ’ s annual revi e w to offer some prognosis for the year ahead.This cannot be done with confidence giv en the uncertainties in precious metals ma r ke t s , the diminishing role of coinage in monetary transactions and the cha n g ing pref e r ences in the market for c o l l e c t a bl e s ,w h i ch muc h of the Corpo r at i o n ’ s output serves . Ho wever , I believe Gold Corpo r a tion now has the rep u t at i o n for quality and innovation and the management expertise that will enable it to maintain market share in its establi s h e d pr oducts while opening up new opportunities for growth in the yea r s ahead.
Top:The proposed coining facility, viewed from Goderich Street. Left:Three of the twenty-eight Sydney 2000 Olympic bronze coins. Opposite Page: Series 1 Sydney 2000 Olympic gold coin,The Journey Begins.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T The Journey Begins Group Profile
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old Corporation’s history began more than a metal bullion coin program internationally, under a G century ago with the opening of The Perth Mint unique agreement with the on 20 June 1899. The Mint was established as a branch of Commonwealth of Australia. Britain’s Royal Mint to refine the increasing quantities of Go l d C o r p Australia is a significant participant in internat i o n a l gold being discovered in Western ma r k ets for value-added prec i o u s Australia’s Eastern Goldfields and metal investment and collectable coin to coin it into sovereigns and pro d u c t s ,m a r k eting a wide range of half-sovereigns for the Crown. Mission Statement legal tender bullion and collector Today the Corporation is coins and precious and base metal Australia’s leading precious The mission of me d a l l i o n s . Its major ven t u r es in metals refining and minting Gold Corporation is: 1999-2000 wer e the Sydney 2000 group, providing high quality Ol ympic Coin and Medallion services and precious metal to provide high quality processing, Pro gr a m s , the official Aus t r a l i a n products to domestic and pro g rams commemorating the Sydney international markets. refining and other services to the gold 2000 Olympic Games, held from industry and to develop and market 15 September to 1 October 2000. The Corporation is the holding company of two wholly owned globally, innovative,value-added The Corpo r a tion has one wholly 4 subsidiaries, the Western Australian precious metal products at a owned interna tional operati n g Mint and GoldCorp Australia. It commercial rate of return acceptable su b s i d i a r y, Go l d C o r p Aus t r a l i a provides central services to the (Hong Kong) Limited. to the shareholder. Group, including treasury, Functions bullion services and settlement, accounting, personnel Gold Corporation’s functions, as management, business described in sections 10,36 and 49 development,information systems,public affairs, of the Act,include: government relations,security and records management. • providing high quality processing services to Some treasury services,such as depository and metal the precious metals industry; leasing, are also offered to external clients. • adding value to Australia’s precious metals The Corporation was created by the Gold Corporation Act before export;and 1987 on 30 June 1988 and is wholly owned by the • generating consumer interest in,and Government of Western Australia. The Act formalised the demand for, precious metals. merger of the Western Australian Mint (also known as The Perth Mint) and GoldCorp Australia. GoldCorp Australia was formed in 1986 to manage the redevelopment of the Western Australian Mint and to mint and market Australia’s first legal tender precious
Top Left: 1999 Cook Islands Marine Life Series - Clown Anemone; 2oz 2000 Australian Proof Nugget gold coin; 2000 Australian Coin Fair Privy Mark Series - 2oz Kookaburra with Roman Silver Antoninianus. Right: Cook Islands Threatened Species Series - Australian Flora - Ptychosperma Bleeseri and Milligania Johnstonii. Opposite Page: Series 2 Sydney 2000 Olympic gold coin,Dedication 1.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Dedication 1 Precious Metal Prices
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Daily Average Perth Mint Prices, January 1999 - August 2000
Gold
6 Silver
Platinum
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Output Measures and Performance Indicators
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nder the Treasurer’s Instructions 904 and 905, a The Corporation’s outputs are: statutory authority is required to provide U • precious metals refining services;and appropriate output measures and performance indicators in • precious metal product sales. its Annual Report,namely: The key efficiency indicato r s for the above outputs are: • Government desired outcome(s) for each output; • key efficiency indicators for each output, relating outputs • the Corporation’s trading results as a proportion of sales to consumed inputs; revenue; • key effectiveness indicators for each outcome, relating • the Corporation’s expenditure as a proportion of total outputs to achieved outcomes;and revenue;and • comparative results for the output measures of quantity, • the cost per ounce of refining gold expressed as an index. quality, timeliness and cost. The Corporation’s key effectiveness and efficiency Given the above Instructions and taking into consideration indicators since 1995-96 are tabulated on pages 41 and 42 the Corporation’s functions under the Act,the Corporation’s of this Report. outcomes are: Under the Treasurer’s Instructions,output measures • high quality precious metal refining; describing quantity, quality, timeliness and cost are also to • value-added precious metal product manufacture be included in a statutory authority’s Annual Report for each and marketing;and output identified above. An output measure analysis with 7 • a commercial rate of return on its equity. this information is presented on the next page. The key effectiveness indicato r s for the above outcomes are: • the estimated proportion of Australian fine gold refined annually by the Corporation and the AGR JV; • the Australian Nugget’s annual share of the world bullion coin market; • the annual value added to gold,silver, platinum and palladium in (i) coin production and (ii) other precious metal products (eg: blanks); • the Corporation’s annual return on equity, (i) before and (ii) after abnormal items;and • the average daily number of visitors to The Perth Mint Shop.
1999 Kilo US State Quarters Privy Mark Series.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Output Measures and Performance Indicators
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OUTPUT MEASURE ANALYSIS
OUTPUT REFINING SERVICES PRODUCT SALES GROUP TOTAL MEASURE Actual Budget Actual Budget Actual Budget $M $M $M $M $M $M QUANTITY 2 2 52 34 54 36 (Note 1) COST 0 0 47 32 47 32 (Note 2)
QUALITY Gold and silver bars produced byThe The weight and purity of all Australian The Corporation sells some 90 Perth Mint and the AGR JV are legal tender precious metal coins percent of its precious metal coins and accredited for their accurate weight manufactured byThe Perth Mint are products in international markets. and purity by the London Bullion described in the Commonwealth The Corporation is committed to Market Association (LBMA),Tokyo Currency Act 1965. maintaining the product quality Commodities Exchange (TOCOM) The Corporation has installed standards described opposite to and the Comex Division of the New processing and management systems protect its international market status. York Mercantile Exchange (Comex). to ensure it meets these statutory specifications. 8 TIMELINESS The AGR JV melts,samples and assays The Corporation’s minting and The Corporation complies with primary precious metal doré within marketing divisions operate in an standard international two-day two business days of receipt at the international commercial environment settlement terms on its precious metal Perth refinery. and must be timely with regard to and precious metal product purchases product releases and manufacture to and sales. This turnaround time is equivalent to remain competitive. the most efficient international industry standards.
Note 1: The Group quantity measure is the actual trading profit and other revenue for the fiscal year, compared with the financial estimate in the Corporation’s 1999 Annual Report. Refining Services income is derived from the Group’s investment in the AGR Joint Venture partnership. Income from the partnership is included as a single line item in the group Operating Statements. Further information is presented in the group Operating Statements and Note 2 of the Financial Statements. Note 2: The cost measure of each output is the actual total expenditure for the fiscal year, compared with the financial estimate in the Corporation’s 1999 Annual Report.
Opposite Page: Series 3 Sydney 2000 Olympic gold coin,Dedication 2.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Dedication 2 Management
( S E N I O R S T A F F AT 3 0 J U N E 2 0 0 0 )
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GOLD CORPORATION Chief Executive Officer: Don Mackay-Coghill Chief Financial Officer: Jesper Sentow Group Accountant and Joint Company Secretary: Anne Melville Manager, Business Development and Joint Company Secretary: Michael Kile Manager, Information Systems: Mannie Comacho Manager,Personnel and Industrial Relations: Giles Talbot Manager, Public Affairs: Alison Puchy Manager, Risk Services: Chris Mumme Manager,Treasury Operations: Nigel Moffatt GOLDCORP AUSTRALIA Managing Director: Don Mackay-Coghill Marketing Director, Proprietary and Special Projects: Veronica Maguire General Manager,Perth Mint Retail Operations: Chris Rosagro Manager, Customer Services: Justin Kees 10 Director, Europe: Ernst Jurgens Managing Director, GoldCorp Australia (Hong Kong) Ltd: Dominic Leung Agent,United States: George Hall Agent, Japan: Koji Ishikawa WESTERN AUSTRALIAN MINT Managing Director,Western Australian Mint: Don Mackay-Coghill Operations Manager, Minting: Eric Brogle AGR MANAGEMENT SERVICES PTY LTD Managing Director: Brian Bath Deputy Managing Director and Finance Director: Richard Hayes Associate Director, Marketing (Refining Services): Michael Cotton Associate Director,Technical Services: Darrall Trainor General Manager, Products Division: Brian O’Connor Operations Manager, Refining (Newburn): David Woodford General Manager, Gold Corporation (Thailand) Ltd: Kasame Chunhasomboon NOTE: AGR Management Services Pty Ltd (ACN 085 142 605) is a company incorporated and controlled by Golden West (Australasia) Pty Ltd (ACN 073 121 918) and the Western Australian Mint.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Group Structure
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NM GOLD CORPORA T I O N ROTHSCHILD AUSTRALIA HOLDINGS PTY LIMITED
REFINING MINTING & FUNCTION & INDUSTRIAL RETAILING PRODUCTS 50.1%
GOLDCORP KALTAILS WESTERN GOLDEN WEST SUBSIDIARY AUSTRALIAN AUSTRALIA JOINT 10% REFINING VENTURE MINT CORPORATION (Note 2) LIMITED
50% 100% 11 SYDNEY 2000 50% 100% OLYMPIC COIN GOLDEN WEST & MEDALLION (AUSTRALASIA) PROGRAMS PTY LTD (Note 1)
50%
Investment Products Division AGR JOINT VENTURE (Note 3) Numismatic Division AGR Management Services Pty Ltd Aust. 100% DIVISION Special Projects Division Australian Gold Refineries (AGR) - Refining Aust. 100% Collectables Division Metals Refining Operations Pty Ltd PNG 45% Perth Mint Shop Gold Corporation (Thailand) Ltd Thailand 100% Perth Mint Depository Alloy & Gold Supply Pty Ltd (AGS) Aust. 50% AGR - Products Aust. 100% AGR Hong Kong HK 100% Golden West (Australasia) Pty Ltd NZ 100%
Note 1: A 50/50 partnership between Gold Corporation and the Royal Australian Mint. Note 2: Gold Corporation has a 10% share in the Kaltails Joint Venture, the balance being held by Normandy Kaltails Pty Ltd. Note 3: The Australian Gold Refineries JV is a 50/50 partnership between the Western Australian Mint and Golden West (Australasia) Pty Ltd. It was formed on 1 December 1998.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Going for Gold
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uring the Sydney 2000 Olympic Games,from Re c helle Haw ke s ,u nveiled the medals. 15 September to 1 October 2000,Australia D Following the unveiling,Australia’s most decorated commanded the attention of the world,as the Games were Olympic athlete, Shirley de la Hunty (nee Strickland), broadcast to a massive worldwide audience of some pressed the button to commence the official production of 3.5 billion people. the gold medals. The event showcased far more than Sydney’s magnificent Both women went on to play significant roles in the Games, new sporting venues and the world’s most talented athletes. with Rechelle reading the A t h l e t e s ’O ath and Shirley It provided a platform to profile The Perth Mint pa rt i c i p a ting in the final lap of the Tor c h Relay at the Opening internationally. Ce re m o n y. Re c helle also succeeded in winning a gold medal The Perth Mint is proud to have ‘gone for gold’in 2000 by in Sydney,the third in her illustrious caree r . playing the most significant role of anyWestern Australian Olympic organising committees create their own design for organisation in the Sydney 2000 Olympic and Paralympic the ‘reverse’of the Olympic medals,and add elements to Games. the ‘obverse’to distinguish their victory medals from those Jointly with the Royal Australian Mint,The Perth Mint of previous Olympic Games. produced the Sydney 2000 Olympic and Paralympic victory The Sydney Organising Committee for the Olympic Games medals,as well as the official Olympic and Paralympic coins (SOCOG) invited prominent Australian artists to enter a and a range of medallions. 12 competition to design the medals.This was won by Royal The Perth Mint also developed and marketed Olympic Australian Mint sculptor and designer Wojciech Pietranik. collectables in its own right.Below is a summary of its His design featured the highly identifiable images of the Olympic involvement. Sydney Opera House, the Olympic torch and the Olympic Rings. Sydney 2000 Olympic Victory Medals The obverse design was created by the Italian artist, The Perth Mint and the Royal Australian Mint shared Giuseppe Cassioli,and was introduced for the 1928 production of the Olympic victory medals,with the gold Olympic Games. medals being produced in Perth and the silver and bronze in Canberra. The dimensions and metal content of each gold,silver and bronze medal were strictly regulated by the International Specimen strikes of the victory medals were unveiled at The Olympic Committee (IOC). Each was 68mm in diameter, Perth Mint on with a thickness ranging between 3mm at the rim and 5mm 7 June 2000, as part of the ‘100 Days to Go’celebrations. at the highest point of the relief. The co-captain of the Australian Wom e n ’ s Hockey Tea m , The IOC cha r ter stipulates "the medals for first and second places shall be of silver of at least 925 - 1,000 gr a d e ;t h e medal for first place shall be gilded with at least 6 grams of pu r e gold." The gold medals wer e made from 99.9% pure si l v er plated with a minimum of 6 grams of pure gold; an d
Top: Sydney 2000 Olympic gold victory medal reverse. Above: Set of miniature replica Sydney 2000 Paralympic victory medals. Opposite Page: Series 4 Sydney 2000 Olympic gold coin,Preparation 1.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Preparation 1 Going for Gold
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the silver medals wer e made from 99.9% pure silver . The medals were designed by the internationally-renowned coin and medallion designer, Stuart Devlin. Although 1,000 gold, 1,000 silver and 1,100 bronze victory medals we re pro d u c e d ,o n ly some 650 gold, 650 silver and Sydney 2000 Olympic Coin and Medallion Programs 670 bronze medals we re awa r d e d . Additional bro n z e The Sydney 2000 Olympic Coin Program is the largest medals we re re q u i red for sports such as Judo and Box i n g, international collector coin program in history. w h i ch automat i c a l ly award double bro n z e. The sports of the Sydney 2000 Olympic Games, th e The gold for the medals was donated by OPHIR gold 2000, a env i r onmental trea s u r es of Aus t r a l i a , aspects of Aus t r a l i a ’ s unique project by the communities of Blayney, Cabonne and cultural devel o p m e n t , and the Olympic and athletic ethos, Orange, in the central west of New South Wales. The ar e all recognised and celebrated in the 53 commemorati v e district was named Ophir after King Solomon’s biblical c o i n s ,p roduced jointly by The Per th Mint and the Royal mines,and was the scene of Australia’s first gold rush in Australian Mint. 1851 when payable gold was discovered. It remains the home of world-class mines and gold prospects. The Perth Mint produced all eight gold coins,half of the sixteen silver coins and the full mintage of Silver Kilo The silver for the victory medals was supplied by BHP’s Olympic Masterpieces. Cannington Mine in Queensland and a 20-kilogram ingot donated by the community of Broken Hill in north-western In addition to producing the coins,Gold Corporation was 14 New South Wales. assigned sole responsibility for the Australian and international marketing of the Program. The bronze victory medals were made from recycled Australian 1 and 2 cent coins donated by the Royal The world’s foremost coin designer,Australian-born Stuart Australian Mint, together with a small amount Devlin, was commissioned to design all 25 precious metal of silver. coins, two of which were based on original drawings by Aboriginal Olympic athlete, Nova Peris-Kneebone. Sydney 2000 Paralympic Victory Medals The Sydney 2000 Paralympic Games victory medals were also produced jointly byThe Perth Mint and the Royal Australian Mint. These were unveiled at a special ceremony at the Sydney Opera House on 6 April 2000. The medals feature the internationally recognised icons,the Sydney Harbour Bridge and the Opera House, surrounded by seven of the Paralympic competition venues. The obverse depicts the logos of the Sydney Paralympic Organising Committee (SPOC) and the International Paralympic Committee (IPC).
Top: Sydney 2000 Paralympic gold victory medal reverse. Above: Silver Kilo Olympic Masterpiece in jarrah presentation case.
G O L D C O R P O R A T I O N 2 0 0 0 A N N UA L R E P O R T šš š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š š
Under a separate licence agreement with SOCOG, The Sydney 2000 Paralympic Coin and Perth Mint and the Royal Australian Mint also produced and Medallion Programs marketed medallions with Olympic themes. Extremely low worldwide mintages generated keen Four of the medallion programs were conducted jointly by collector interest in the official Sydney 2000 Paralympic the two mints and a further twelve programs were produced Games commemorative coins,which were launched in and marketed by GoldCorp Australia alone. Sydney in August 2000. Queen Elizabeth II presented with No.1 The gold,silver and bronze coins were produced jointly by Sydney 2000 Millennium Coin Collection the Royal Australian Mint and The Perth Mint,along with miniature replicas of the Sydney 2000 Paralympic victory The Premier of Western Australia,The Hon.Richard Court medals. MLA,presented Her Majesty Queen Elizabeth II with Australia’s most prestigious Olympic memento, the Sydney Sydney 2000 Olympic Coin and Medallion Jewellery 2000 Olympic Millennium Coin Collection,during her visit Collection to Perth in March 2000. During the year,The Perth Mint released a range of The numbered collection,featuring the eight proof gold and jewellery incorporating the official Sydney 2000 Olympic sixteen proof silver coins of the Sydney 2000 Olympic Coin coins and medallions. Program, was the first of only 3,000 sets Set in high quality jewellery frames and protected by crystal released worldwide. 15 lenses,the jewellery was sold through The Perth Mint Shop This gift showcased Western Australia’s natural resources,its and national fine craftsmanship and its manufacturing expertise in one retail outlets. magnificent collection. Glen Holst Furniture, of Bridgetown in the State’s south- west,crafted the superb hand-assembled box from local jarrah and she-oak timbers.
Top: The Western Australian Premier, the Hon.Richard Court MLA,presents the Number 1 Sydney 2000 Millennium Coin Collection to Her Majesty, Queen Elizabeth II (photo courtesy of Channel 7 Perth).
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Going for Gold
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Sydney 2000 Olympic Coin Art Pieces Olympic Profile In March 2000,The Perth Mint released a series of limited The Perth Mint’s involvement in the Sydney 2000 Olympic edition Olympic art pieces incorporating the official and Paralympic Games dramatically increased its profile, Olympic coins. The series was developed to satisfy Olympic both nationally and internationally. In January this year, sponsors’needs for high-quality, official commemorative The Perth Mint and the Royal Australian Mint were Olympic product capable of being displayed in corporate acknowledged internationally by being named joint Mints of boardrooms Honour at the World Money Fair in Basel,Switzerland. In or foyers. the second half of the financial year alone, more than 250 newspaper articles were published and a similar number of Each of the 18 art pieces featured either the gold,silver or radio and television reports were aired in Australia on the bronze legal tender coins of the official Sydney 2000 Olympic Coin Program.Considerable international media Olympic Coin Program. coverage was also generated through wire services and Torch Relay Celebrations visiting overseas media organisations. The Perth Mint celebrated the Sydney 2000 Olympic Torch Relay in a unique way by giving Western Australian Torchbearers a personally inscribed Torch Relay medallion during the Perth leg of the relay. 16 While the Torch Relay made its way around the suburbs of Perth,The Perth Mint joined the festive atmosphere by opening its popular Gold Exhibition to the public, and serving complimentary morning and afternoon teas daily.
Top: A young Western Australian Torchbearer arrives at The Perth Mint to receive his personally inscribed Torch Relay Medallion. Above Right: Edge view of the massive Silver Kilo Olympic Masterpiece,the biggest Olympic coin ever minted.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Report on Operations
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FINANCIAL SUMMARY GROUP SUBSIDIARIES The Group’s annual operating profit before the statutory GoldCorp Australia contribution payable to the Western Australian Government GoldCorp Australia’s major products are precious metal in lieu of Commonwealth income tax was $7.0 million. coins and medallions. The main coin programs have legal This compares with a Group profit of $6.5 million before tender status under Australia’s Currency Act and are abnormal profit and statutory contribution in fiscal manufactured and marketed by formal agreement with the 1998-1999. Commonwealth Government. The Commonwealth receives A statutory contribution of $3.3 million will be paid to the a royalty on each coin sold by the Group. In the case of the Western Australian Government in fiscal 2000-2001. Sydney 2000 Olympic Coin Program,certain other entities also receive royalty payments. The Board recommended to the Western Australian Treasurer that the dividend payable to the Western The current range of coins includes the series of gold Australian Government for fiscal 1999-2000 should be $1.8 Australian Kangaroo Nuggets,platinum Australian Koalas, million. silver Australian Kookaburras and the gold and silver Australian Lunar series. In addition to this standard annual Since its establishment in 1988,Gold Corporation has made range of coins,permission was also granted for the release income tax equivalent and dividend payments to the of special commemorative issues during 1999–2000, Western Australian Government of $27 million. including two Millennium coins and a number of privy mark 17 The Corporation also pays royalties to the Commonwealth issues with themes ranging from Ancient Coins to US State annually on all its Australian legal tender coin sales. An Quarters. amount of $1.4 million will be paid for the fiscal year, In addition to the Australian coin programs,GoldCorp bringing total payments since fiscal 1991-1992 to Australia also mints coins under the authority of the $8.7 million. Governments of the Cook Islands,Tuvalu and Zambia,and Payments to the State and Federal Governments since produces a diverse range of medallions and special sets. inception now total $35.7 million,or an average annual Coins and medallions are manufactured to proof and bullion payment of $2.9 million. or uncirculated quality. In addition,the introduction of The Corporation’s capital expenditure for the year was $2.9 colour to many new coins has seen the creation of a new million,$1.7 million of which was spent by the coining category of ‘proof-like’coins. department on new equipment. Coin and medallion sales,excluding the Sydney 2000 Olympic Coin Program, in 1999-2000 (1998-1999) utilised 4.6 tonnes (6.6 tonnes) of gold,27.2 tonnes (12.6 tonnes) of silver and 0.13 tonnes (0.24 tonnes) of platinum.
Above Right: Australia 2000 Silver Millennium Coin. Above Left: Australia 2000 Bi-Metal Millennium Coin.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Report on Operations
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Investment Products Special Projects The international investment products market remained A wide range of coin issues was released under the Special extremely depressed during the year, due to lacklustre gold Projects banner during the year. Most popular among these prices and continuing uncertainty regarding gold reserve were two innovative Millennium coins,each of which sold asset sales by central banks. Global demand for gold bullion out within weeks of their release. Also exceptionally coins declined dramatically during the financial year, as popular was a Cook Islands Year of the Dragon gold coin North American concern over Y2K dissipated during the program,issued for sale in South East Asia. To capitalise on second half. Total world bullion coin sales for the June the extraordinary interest in the Year of the Dragon,a one quarter were 89% less than in the same period the previous kilogram Australian legal tender silver coin was released, year. While the Australian Nugget’s world market share featuring a coloured dragon design,with two yellow increased from 5.9% in calendar 1999 to 12.9% in the first diamonds positioned as the Dragon’s eyes. This coin half of the 2000 calendar year, the total volume of coin sales received considerable media interest and was extremely declined as investors retreated from the market. popular with collectors. Numismatic Products In addition to these coin programs,strong overseas demand for coin blanks continued to make a significant contribution Sales of proof gold and silver Lunar Year of the Dragon coins to revenue. were the main contributor to the Numismatic Products 18 category. Full advantage was taken of the widespread Perth Mint Collectables interest in Dragon-theme coin issues and the response was A new division, Perth Mint Collectables, was launched in greater, and much more widespread,than anticipated. March 2000. Its role is to capitalise on The Perth Mint’s Privy Mark coins also continued to be popular and a new reputation for minting excellence, integrity, creativity and issue introduced to pay tribute to the United States 50-State innovation, by developing a range of proprietary and Quarter series attracted overseas collector interest. customised products that will have appeal to both the corporate and collectables markets across a diversity of interests. The initial product range consisted of limited edition framed Olympic Art Pieces incorporating the official Sydney 2000 Olympic Coins and plates of Stuart Devlin’s original coin designs. This range of gold,silver and bronze art pieces was positioned to appeal both to corporate customers and individual collectors. The initial response was positive and several new projects were planned for the new financial year, featuring a variety of themes,including sports, Centenary of Federation,wine and the Chinese Lunar calendar. E-Commerce
Top: 1 Kilo Silver Diamond-Eyed Dragon - the first Australian coin to incorporate diamonds in its design. Above: Limited edition Gold,Silver and Bronze Sydney 2000 Olympic Art Pieces, featuring the official Olympic coins. Opposite Page: Series 5 Sydney 2000 Olympic gold coin,Preparation 2.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Preparation 2 Report on Operations
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In mid-January, GoldCorp Australia commenced a The Program is the largest non-circulating Olympic coin redevelopment plan for its internet site, with the aim of program in history, sold in some 50 countries. It extends upgrading the existing site’s navigation,appearance and from October 1997 to interactive capabilities,and introducing an on-line shop. 30 June 2001 and consists of three series of coins in gold, silver and bronze. The three main objectives for the website were to: A partnership between The Perth Mint and the Royal • provide collectors/clients with access to comprehensive Australian Mint,the Program is authorised by the information on The Perth Mint and its range of Commonwealth of Australia and the Sydney Organising products; Committee for the Olympic Games (SOCOG). • reach retail customers,particularly in the United States, where traditional distribution is fragmented and The Sydney 2000 Olympic Coin Collection consists of fifty- specialised;and three coins in total:eight proof gold coins,sixteen proof • introduce a business-to-business extranet to facilitate silver coins,twenty-eight bronze uncirculated coins,and the the flow of information to and from distributors and to proof Silver Kilo Olympic Masterpiece. attract new distribution opportunities. Several issues needed to be taken into account. Foremost among these was the need to prevent any conflict between 20 GoldCorp Australia’s on-line activities and the activities of its distributors,which often operate under exclusive regional distribution agreements. Distribution strategy was another key issue, with the need to determine where stocks would be warehoused to service orders in a timely and efficient manner. A conservati v e budget was assigned for the red e velopment of the site, and the Wes t e r n Australian company, Pr etzel Logic , was appointed to underta k e production of the e-store and to red e velop the existing site. The e-store was launched on 5 July 2000,with a limited initial product range, to prevent conflict with international distributors. Orders will be dispatched from Perth until regional demand levels are ascertained. The Sydney 2000 Olympic Coin Program The Sydney 2000 Olympic Coin Program commemorates the Games of the XXVII Olympiad.
Top: The Home Page of The Perth Mint Website - www.perthmint.com.au
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The 10 gram gold coins celebrate the athlete and the Australia Post stores in Victoria, compared with non- Olympic ethos,and have limited mintages of 30,000 each. merchandised stores,increased by 385%,and sales in New The one ounce silver coins depict the fauna and flora and South Wales and Western Australia increased by 343% and culture of Australia,and have maximum mintages of 340%, respectively. 100,000 each. The bronze coins represent the 28 sports of Australia Post was again the largest single distribution the Sydney 2000 Olympic Games and have been minted to channel,selling almost a million coins during the year demand. The Silver Kilo Olympic through its Australian network of Masterpiece is the largest corporate and licensed post offices. Olympic coin ever minted and the These spectacular results were first to feature all of the sports of largely attributable to the an Olympic Games. Its mintage is From the launch of the successful merchandising campaign limited to 20,000. Sydney 2000 Olympic Coin undertaken in Australia Post During the year, a total of 2.2 Program in October 1997 to outlets and marketing initiatives million coins (1.7 million bronze, aimed at educating and motivating 418,000 silver, 84,000 gold and the end of June 2000,a total of Australia Post sales staff in regard 9,000 Silver Kilo Olympic 4.2 million coins were sold. to the coin program. Masterpieces) were sold, An important development following an intensive global This was almost twice as many occurred at the end of the financial 21 marketing campaign led byThe coins as were sold over the year, with Canada Post agreeing to Perth Mint. entire life of the distribute the Sydney 2000 From the launch of the Sydney Atlanta Olympic Coin Program Olympic Coin Program. This 2000 Olympic Coin Program in distribution agreement was October 1997 to the end of (2.4 million). expected to boost North American June 2000,a total of 4.2 million sales substantially. The agreement coins were sold – 3.4 million followed the demonstrated success bronze, 689,000 silver, 150,000 of the coin program through the gold and 9,000 Silver Kilo Olympic Masterpieces.This was Australia Post network. almost twice as many coins as were sold over the entire life The Australian advertising and promotional campaign during of the United States Mint’s Atlanta Olympic Coin Program the year focused on targeted print and television advertising, (2.4 million). in conjunction with a national publicity tour. Surveys During the year, research proved the value of the Retail showed that prompted awareness increased from 4% in Merchandising Campaign initiated last year in Australian September 1998 to 35% in June 2000,with unprompted retail outlets. Sales of bronze coins in merchandised awareness increasing from 29% to 59% in the same period.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Report on Operations
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For the third successive year, the Sydney 2000 Olympic Coin Program was honoured in the Coin of the Year awards conducted by the European coin magazine, Deutsches Münzen. The Series 4 gold coin,‘Preparation 1’,designed by Stuart Devlin and shown on page 13, was voted the third most popular coin in a 1999 reader’s poll,achieving this distinction against a strong field of coins from around the world. SYDNEY 2000 OLYMPIC COIN PR O G R A M THEME Athlete & Australian Australian Individual All 28 Olympic Ethos Culture Fauna & Flora Olympic Sports Olympic Sports METAL 99.99% Gold 99.9% Silver 99.9% Silver Al Zn Bronze 99.9% Silver 1997 The Journey Festival of the Kangaroo & Archery October Begins Dreaming Grasstrees Athletics (Release 1) Gymnastics Hockey Sailing Weightlifting 1998 Dedication 1 A Sea Change 1 GreatWhite Shark Cycling April & Coral Football (Release 2) Triathlon 22 1998 Dedication 2 A Sea Change 2 Frill-Necked Lizard Canoe/Kayak September & Sturt’s Desert Pea Handball (Release 3) Softball Wrestling 1999 Preparation 1 Reaching the Emu & Wattle Basketball April World 1 Taekwondo (Release 4) Tennis 1999 Preparation 2 Reaching the Koala & Badminton September World 2 Flowering Gum Fencing (Release 5) Shooting Table Tennis 2000 Achievement Harbour of Life Platypus & Waterlily Baseball March (Stadium) (Water) Judo (Release 6) Rowing Volleyball 2000 Achievement Harbour of Life Echidna & Tea-Tree Nil March (Athlete) (Land) (Release 7) 2000 Achievement Harbour of Life Kookaburra & Aquatics Silver Kilo March (Torch) (Air) Waratah Boxing Olympic (Release 8) Equestrian Masterpiece Modern Pentathlon
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The Sydney 2000 Olympic Medallion Program In the past year, most activity revolved around developing and manufacturing the core product range and developing During the year,The Perth Mint and the Royal Australian strategic alliances with selected Olympic licensees and Mint produced and marketed a range of minted medallions retailers. A number of customised minting projects were under a licence agreement with SOCOG. also undertaken. Four of the medallion programs were conducted jointly by Two key objectives,namely to open up new distribution the two mints and a further twelve programs were produced channels and to expand direct marketing opportunities, and marketed by GoldCorp Australia alone. were realised during the year, with Australia Post, Myer The joint programs released during the year were:the Direct (The Direct Fulfilment Group) and Myer Grace Bros Olympic Mascot Medallion & Sports Coin Collector’s becoming medallion distributors. Series;Olympic Sports Coin & Pin Set;Olympic Sports A further strategy, to penetrate the retail newsagent and gift Coin & Mascot Medallion Set;and Olympic Torch Relay shop markets, was achieved with the appointment of Transit Medallion Booklet. Distribution, which had the necessary resources to distribute In addition to the above, GoldCorp Australia released the medallion products and to service this market segment following medallion products:the Australian Olympic effectively. Heroes Medallion Collection;Olympic Mascots Medallion; An early measure of the appeal of the medallion product was Countdown Pin & Medallion Sets;Shell Sporting Pictograms evident by June 2000 when the Olympic Torch Relay arrived of the Sydney 2000 Olympic Games;Olympic Emblem 23 in Australia.The Torch Relay Medallion was consistently Medallions Framed Set;and Olympic Mascot Medallions rated as the second-largest selling item from the official Framed Set. merchandise van that followed the route. GoldCorp Australia also released a series of colourful products housed in booklets. These included:the Olympic Emblem Medallion;Olympic Emblem & Pin Set;Olympic Torch Relay Medallion & Pin Set;Olympic Mascot Medallion;and Olympic Mascot Medallion & Pin Set.
Centre: Sydney 2000 Countdown Pin & Medallion Set, issued as part of GoldCorp Australia’s Olympic Medallion Program. Centre Right and Left: Products from the Sydney 2000 Olympic Coin and Medallion Jewellery Collection.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Report on Operations
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A national promotional roadshow was undertaken in In April,the world’s second biggest natural gold nugget,the July 2000,with the aim of showcasing the entire range of ‘Normandy’nugget, went on display to the public for the medallions to major retailers. In addition,targeted sales first time, with much attendant publicity. Encapsulated strategies were implemented during the key selling period in nuggets,a new presentation concept aimed at the United the weeks leading up to, during, and just after the Games. States market, were introduced. These initiatives elevated natural nuggets to a new ‘Perth Mint’branded collectable Perth Mint Shop product. The Per th Mint Shop sells a wide range of precious metal At the end of the year, the Shop adjusted the prices of 2,500 pr oducts to inve s t o rs ,c o l l e c t o rs ,j ewel l e r y buye r s and stock lines as a consequence of the introduction of the GST. t o u ri s t s. The Per th Mint’s Gold Exhibition is a favou re d The changeover was implemented smoothly and trading to u r ist destination and attracts many visitors to the Shop. continued unabated over the year-end period. The Shop and Gold Exhibition performed strongly over the In June,The Perth Mint won three Western Australian year due to growing overseas tourism and high domestic Tourism Awards in the categories of Tourism Retailing, consumer confidence. Heritage and Cultural Tourism and Promotional and The popularity of the Sydney 2000 Olympic Coin Marketing Campaigns. An important objective for the Collection was enhanced by sell-outs of some of the coins, coming year will be to convert this recognition into while regular launches of Olympic Countdown pins increased market penetration,particularly of the lucrative 24 stimulated new local interest. The introduction of dedicated overseas tourist market. Olympic coin and pin counters in the Perth Mint foyer Long-term external retail opportunities have been identified made a significant contribution to sales. at a variety of tourist venues,including the new Bell Tower During the Games,The Perth Mint Shop operated a retail in Perth,the new Australian Museum in Canberra,the outlet in Sydney’s Darling Harbour precinct,taking Museum of Victoria,and the new Prospectors’and Miners’ advantage of the large volume of tourist traffic. Hall of Fame in Kalgoorlie. Despite slow recovery in Asian economies,international tourist traffic to the Mint remained strong. A weak Australian Dollar also enticed a growing number of visitors from the United States and Europe. The Mint’s own marketing was effective and benefited from the flow-on effect of publicity generated in the previous Centenary year.Visitor numbers increased by 4.5% to 116,604. Pre Christmas sales were particularly vigorous and were buoyed by the Golden Dragon and Millennium coin issues and commission from ‘Millennium Gold’ champagne sales.Post Christmas sales were supported by a Year of the Dragon medallion for custom engraving.
Above: The world’s second largest natural gold nugget,the 819oz (26.3kg) ‘Normandy’nugget, which was on display at The Perth Mint from April to October 2000,on loan from the Normandy Mining Group.
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Perth Mint Depository Western Australian Mint The Perth Mint Depository division is comprised of AGR Joint Venture Perth Mint Depository Services and the Perth Mint Certificate Program. The Australian Gold Refineries Joint Venture (AGR JV) is jointly owned by the Western Australian Mint and Golden The Perth Mint Depository offers confidential precious West (Australasia) Pty Ltd in equal shares,and is managed metal storage to international private clients,trusts and by AGR Management Services Pty Ltd. corporations seeking offshore storage and portfolio diversification under a government guarantee. The service is The AGR JV reported an operating profit before taxation of promoted via the Internet and an international $3.667 million for the 12 months ended representative network of approved dealers,and is currently 30 June 2000,after allowing for restructuring costs and focussed on North America and Europe. The minimum goodwill amortisation. investment is USD50,000. During 1999-2000,both the Refining and Product Divisions The division’s performance during the year exceeded budget consolidated their respective operations on to single sites in expectations once again,despite declining interest in Perth and Melbourne, resulting in significant administrative precious metal investment in international markets. and operational efficiency gains. The Perth Mint Certificate Program is designed primarily to The AGR JV is engaged in negotiating with a number of attract international investment in Australian precious metal companies on production and technology-related issues 25 legal tender coins and bars,which are stored at the Mint on aimed at enhancing its diversification strategy. behalf of investors. The minimum investment is Australian Gold Refineries USD25,000. The Certificate is a non-negotiable but transferable warehouse receipt and is not a bearer Consolidation of the refining activities to a single location in instrument. It is retailed via an international Approved Newburn,Western Australia,has provided the joint venture Dealer network. with the opportunity to establish three distinct refining circuits to produce fine gold products,ranging from London The Program was launched in the United States in April Good Delivery purity of 99.5+% to 99.999% purity. 2000 at a seminar in Palm Springs,California. Four new Perth Mint Certificate Approved Dealers were subsequently Refined fine gold output was 246 tonnes for the 12 months appointed,which should lead to greater business when ended 30 June 2000,with 59 tonnes coming from overseas. investment sentiment towards precious metals improves. Total Australian fine gold refined was 183 tonnes for the In April,Gold Corporation agreed to act as the preferred year, or 62% percent of total Australian mine production, depository and precious metal supplier for an innovative US plus 4 tonnes of secondary material. mutual fund project to be launched in the USA during the International demand for value-added refinery products such new financial year. The Corporation provided USD250,000 as kilo bars and tola bars was again erratic, with the AGR JV to research and develop the flexibility of the project. producing 86 tonnes of kilo bars and 30 tonnes of tola bars. In addition, AGR JV produced 15 tonnes of 99.999% purity
Above: Collectors queue to purchase Sydney 2000 Countdown Pins at The Perth Mint Pinworkx counter.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Report on Operations
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gold grain for the electronics and computer industries. As part of the AGR JV consolidation strategy, the agency agreement with PT Aurum Argentum Austindo was Refined fine silver output was terminated,and all Indonesian business is now conducted via 81 tonnes for the 12 months ended the Perth Treasury desk. Indonesia performed adequately 30 June 2000. given the continued political and economic uncertainties On 2 January 2000, a ‘slow burn’occurred in the refinery’s prevailing there. electrolytic gold room. Total losses were contained to less Hong Kong than $1 million,which was covered by insurance. While the fire caused inconvenience,AGR JV suffered no material loss AGR Hong Kong traded precious metals and supplied and there were no injuries to staff. precious metal products,jewellery alloys and specialty chemicals to the local market and mainland China. The Products Division business review conducted in 1999 resulted in strategic There were significant changes within the Products Division changes that have impacted positively on the performance of during the year. The manufacturing of all semi-fabricated this regional office, with the bulk of the revenue currently forms of gold and silver for the jewellery, electronics, generated from chemicals,precious metals,sterling silver electrical and building industries, was consolidated into a and metal leasing. new facility in Somerton,Victoria. In addition,an in-depth review of the product range resulted in certain products 26 being out-sourced and some being discontinued. The year also saw the formation of a joint venture with Automated Fusion Technology to distribute AGR JV- manufactured platinum laboratory ware. Continued progress was made with regard to Alloy & Gold Supply (NSW) Pty Ltd and Atlantis Chain to expand the Products Division's role in marketing manufactured jewellery.These initiatives further consolidated the domestic market and provided expanded international opportunities. Gold Corporation (Thailand) Limited Gold Corporation (Thailand) Limited operates a precious metal trading business from premises in central Bangkok. It is a major supplier of kilobars, granules and other precious metal products to the Thai export jewellery sector and also to domestic bullion dealers and consumers. Gold Corporation (Thailand) Limited continued to perform solidly in difficult markets. Indonesia
Above: Precious metal products from AGR JV.
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Metals Refining Operations Events Subsequent to Metals Refining Operations (MRO) is a Port Moresby-based Balance Date precious metals refinery, in which AGR JV has a 45% At the date of this report,the following matters and interest. The other major shareholder is the Government of circumstances have arisen since 30 June 2000 that may affect Papua New Guinea. MRO also offers support services to the state of affairs of the Corporation in subsequent financial the domestic jewellery market and small gold producers. years,namely: MRO performed satisfactorily throughout 1999-2000. 1. On 5 July 2000,GoldCorp Australia launched an on- Westmill line store, featuring a limited range of Perth Mint The Corporation’sWestmill division holds a 10% interest in products. Despite the absence of any promotion,the the Kaltails gold tailings re-treatment project in Kalgoorlie. first on-line order was received within two hours of the The Kaltails project is 90% owned and operated by the launch. One hundred orders (245 products) were sold Normandy Mining Group. in the first 47 days, representing an average of 2.12 orders daily. Almost 80% of orders came from retail Re-treatment operations ceased in 1999-2000,after a study customers in the United States,demonstrating the found that it would not be feasible to treat the low-grade ability of the site to reach the target audience. Oroya and Old Croesus tailings at current gold prices. The 2. On 14 August 2000,Gold Corporation accepted the joint venture will undertake no further processing, but some successful tender for construction of a new, four-level of the remaining high-grade tailings may be sold. The plant 27 production facility, which will also house the sales and equipment has been sold and rehabilitation work has administration,marketing and e-commerce divisions. commenced. It is anticipated that the majority of the work The $13.5 million building is scheduled for completion will be completed in the 2000-2001 financial year. in late 2001. Westmill also controls the remainder of the State Battery System,having assumed control in 1988 to commercialise its operations and to realise the value of the tailings resulting from the operation of the batteries over many decades. During the year, management evaluated the issue of environmental degradation arising from the management of the batteries over many decades. Rehabilitation of the State Battery sites is a potentially complex and costly venture. Discussions with the Departments of Minerals and Energy, Environmental Protection and Land Administration have revealed strong support for a ‘whole of government’ approach to this issue, as no individual government agency has the resources to undertake such an extensive rehabilitation program.
Above Right: Australian Nugget 2000 Proof Issue.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Report on Operations
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Staff A strategic business planning exercise in April 1999 identified a gap in senior management,following the Following the significant reduction in permanent and transfer of staff to the AGR JV, and the need for further temporary contract staff in 1998-99 as a result of the information systems development as matters requiring formation of the AGR JV, staff numbers in Gold Corporation urgent attention. As a result,a Chief Financial Officer was and the Western Australian Mint increased slightly during recruited from Melbourne in October 1999 to head the 1999-2000 from 189 (including 12 part-time staff) to 197 Corporation’s financial and administrative functions.A (including eight part-time). The increase took place mainly Manager, Information Systems, reporting to the Chief in the marketing area. Financial Officer, was appointed in January 2000 to At 30 June 2000,permanent and temporary contract staff centralise and upgrade services and systems. were assigned as follows (1999 figures in brackets): The proportion of women on the staff in Western Australia Gold Corporation 26 ( 23) was virtually unchanged at 42.8% (43.7%) or 43.4% of all Western Australian Mint 113 (113) staff in Australia. The number of women in middle and GoldCorp Australia (includes Europe) 55 ( 50) senior management or equivalent positions (Peromnes grade GoldCorp Australia (Hong Kong) Ltd 3 ( 3) 8 and above) was 7,the same as in the previous year. Work on overseas blanking contracts and the Sydney 2000 Employees from non-English speaking backgrounds comprise 16.7% (15.1%) of staff in Australia. 28 Olympic Coin and Medallion Programs continued at a high level of intensity, and at one point,more than 140 personnel Gross staff turnover was 16.8% (24.1%) for the year. The from a labour hire agency were needed to supplement core 1998-1999 figure was particularly high due to redundancies staff in the Coining Department. The number had,however, arising from the establishment of the AGR Joint Venture. halved by the end of the financial year. The agency contract The avoidable turnover rate in 1999-2000 ie the rate was re-negotiated,with a significant saving in costs.A excluding retirements, redundancies,ill-health,employee number of clerical and accounting personnel were also relocation etc, was 10.5% (13.6%). employed through various agencies to cater for the increased volume of activity. This was expected to decline significantly The number of Western Australian Mint staff employed after the Olympic Games. under Western Australian workplace agreements was largely unchanged at 53 (55). There were 31 (32) staff employed Staff employed in Australia fell into the following broad under engineering, clerical and security awards. categories: The issue of enterprise bargaining was discussed with one of Salaried 99 (92) the unions represented at the Western Australian Mint, but Wages 92 (91) was not pursued by mutual agreement. There were no work There were 187 staff (182) based in Western Australia,four stoppages and no other industrial activity during the year. (one) in the eastern states and six (six) in Hong Kong and Two equal opportunity complaints against the Western Switzerland. Overseas staff are all residents of the countries Australian Mint were made by personnel agency staff during concerned.
Opposite Page: Series 6 Sydney 2000 Olympic gold coin,Achievement (Stadium).
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Achievement (Stadium) Report on Operations
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the year, under the clause in the Equal Opportunity Act Industry and Community regulating the relationship between a principal and the Participation employees of contractors. Both complaints were dismissed by the Equal Opportunity Commission,though at the time As part of its functions under the Gold Corporation Act of writing the complainants in the second case had referred 1987,the Corporation is obliged to encourage industry and it to the Equal Opportunity Tribunal and the matter had still community interest in precious metals and the Australian to be heard. gold industry. Fo l l owing a risk management survey of the organisat i o n , Production of the quarterly precious metals journal, t h ree key areas of potential risk we re identified in re l at i o n The Australian Nugget Journal, and the periodical, The to the staffing function. These we re the loss of, o r Australian Numismatic Post, continued during the year. i n c o rre c t , pay r oll dat a , the loss of key pers o n n e l , and the In December 1999, in the final month of The Per th Mint’s standard of staff selection. In the year under rev i ew, t h e re centennial yea r , the Corpo r a tion published a catalogue of we re no significant mat t e rs to re p o rt in these are a s. coin production at The Per th Mint entitled A Century of The Pe rsonnel and Industrial Relations depart m e n t Minting Excellence. This is a companion to the history book, continued to provide personnel and pay roll services to the St r iking Gold - 100 Yea r s of The Per th Mint, wh i c h was publi s h e d AGR Joint Ve n t u re on a fee basis, and this arr a n g e m e n t in June 1999. Copies of both publi c a tions are avai l a b le for will continue in 2000-2001. sale through the Mint’s mailing list,The Per th Mint Gold 30 Shop and coin dealers.
Above: The 1999 centennial publication,A Century of Minting Excellence.
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The AGR JV was again a presenter of the Australian Gold in the W S Lonnie Awards for Excellence in Public Sector Co n f e re n c e ,Aus t r a l i a ’ s premier annual gold forum . Arr a n g e d Reporting. This was the second successive year in which the by the Chamber of Minerals and Energy of Wes t e r n Aus t r a l i a , Corporation had been honoured in the awards,having won a the conference was held at the Burswood Convention Centre Bronze Award in 1998. in Per th and attracted some 500 parti c i p a n t s . Th e Western Australian Tourism Awards Co rp o r a tion will continue its association with the conferen c e in 2001 via the AGR JV’s sponsorship of this even t . The AGR The Perth Mint was a major winner in the 2000 Western JV also sponsored and parti c i p a ted in the Diggers and Dealers Australian Tourism Awards,becoming the first organisation mining conference in Kalgoorlie during the yea r . in the 28-year history of the awards to win three categories. The Mint is now a national finalist in the Retail Tourism, Gold Corpo r a tion is a member of the World Gold Council Heritage and Cultural Tourism and Promotional and and an associate member of the Australian Gold Council. Th e Marketing Campaigns categories AGR JV is an associate member of the Chamber of Minerals of the awards,which will be announced in Canberra at the and Energy of Wes t e r n Aus t r a l i a , the As s o c i a tion of Mining end and Exploration Companies and the Australian Gold Council. of November 2000. Gold Corporation is a member of the Chamber of Commerce and Industry of Western Australia and of the Australian Institute of Management.It is also a member of Standards Australia. 31 The Perth Mint is a member of the Western Australian Chinese Chamber of Commerce Inc and in November 1999 hosted a major function for the Chamber celebrating the launch of the Australian Lunar Series Year of the Dragon legal tender coins. The launch was performed by Mr Tian Junting, the Consul-General of the People’s Republic of China (Perth). The Perth Mint is a Silver Member of the Perth Convention Bureau,and a member of the Meetings Industry Association of Australia,the Association of Perth Attractions,Museums Australia,the Inbound Tour Operators Association,Tourism Council Australia and the Royal Western Australian Historical Society. Awards W S Lonnie Awards Gold Corporation’s 1999 Annual Report won a Silver Award
Ce n t re : Gold Corpo r ation Chief Exec u t i v e Officer,Mr Don Mackay - C og h i l l , with the three 2000Wes t e r n Au s t r alian Tou r ism Awards won by The Per th Mint. Ab o ve Right: 2000 Cook Islands Insect Series 1oz coloured coins.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Board of Directors
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CHAIRMAN DIRECTORS LESLIE McCARREY CMG, BEc(Hons),BSc PETER LALOR LL.B Mr McCarrey is a former Under Treasurer of Western Mr Lalor is the Executive Chairman of Sons of Gwalia Ltd, Australia and Director General of Economic Development. one of Australia's largest and most successful mining He is widely experienced in financial management and was companies and also a substantial participant in Australia's involved in all aspects of Commonwealth and State financial industrial minerals industry. Mr Lalor is also a Director of relations for more than twenty years. the World Gold Council, aVice President of the Western Australian Chamber of Minerals and Energy and a member Mr McCarrey chaired the Independent Commission to of the Executive Committee of the Minerals Council of ReviewWestern Australia’s Public Sector Finances from Australia.He is also the Deputy Chairman of the Australian February to August 1993. He was State Under Treasurer Gold Council,which was established in 1999. from 1976 to 1984,having previously occupied the position of Deputy Under Treasurer for five years and Assistant Under Treasurer for a similar period. PETER UNSWORTH During his career, Mr McCarrey served on a variety of State CA,BCom Government and national committees. He was Chairman of Mr Unsworth specialises in corporate finance and is a the Gas Strategy Committee and Chairman of the Trustee 32 director of a number of public and private companies. He Investments Review Committee. He is a past Commissioner recently retired as an Executive Director of Western of the R&I Bank. As Director General of Economic Australian stockbroking company Paterson Ord Minnett Development he directed a number of project and Ltd. investment analysis studies. Mr Unsworth's career has included Following his retirement from Government service, Mr six years with international accounting firm Coopers & McCarrey was Director of the Institute of Public Affairs Lybrand (now PricewaterhouseCoopers) in Perth and Limited,States’ Policy Unit and a Senior Fellow of the Sydney and six years with the Perth Stock Exchange Ltd. Institute from 1986 until 1989. Since 1990 he has been an Emeritus Fellow of the Institute. Mr McCarrey is Deputy Chairman of the AGR Joint Venture and a Director of Vitech Assembly Ltd,an electronics company employing people with disabilities.
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MA R TINE POP PhD EEC Commercial Law DON MACKAY-COGHILL Ms Pop has more than 12 years of credit, risk management Mr Mackay-Coghill is the Chief Executive Officer of Gold and control management experience with the banking Corporation,a position he has held since the proclamation industry in senior and executive positions. She has been of the Gold Corporation Act on 30 June, 1988. working in the consulting industry for the last five years, Mr Mackay-Coghill joined International Gold Corporation providing risk management and corporate management Limited (Intergold) in South Africa in 1971,an organisation services to the public and private sectors. She holds established to promote the industrial uses of gold directorships of the AGR Joint Venture, Special Broadcasting worldwide. The following year, he was appointed Manager Service (SBS),The Grain Pool of WA,the Centre for Mental of the Johannesburg Office of Intergold. He became Health Services Research,and AgWest.She is a member of Manager,Worldwide, in 1975 and was appointed Chief the Management Review and Audit Committee of Edith Executive,Worldwide, in 1979. Cowan University and of the University of Western Australia's Institute of Advanced Studies Advisory Board.She During his time at Intergold,Mr Mackay-Coghill was is also a member of the Australian Institute of Company responsible for the outstandingly successful international Directors and of the Institute of Internal Auditors. marketing of the Krugerrand,which created the first global market for bullion coins. In recognition of his achievements he received the South African Marketing Award of the Year JOHN LANGOULANT BEc(Hons) in 1978. 33 Mr Langoulant is the Western Australian Under Treasurer, a He resigned from Intergold in 1986 and emigra ted from position he has held since June 1995.Prior to this South Af r ica to take up the dual position of Chief Exec u t i v e appointment, he worked for 18 years in State and Federal officer of GoldCorp Aus t r a l i a , and Managing Director of the Treasury Departments,developing and implementing Wes t e r n Australian Mint. economic and financial policies. More than a decade of this He holds directorships at the World Gold Council and the experience was with the Federal Treasury in Canberra. Mr AGR Joint Venture. Langoulant is also Chairman of the Western Australian Treasury Corporation and a Director of the Asia Research Centre.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Corporate Governance
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Functions of the Board Apart from the Under Treasurer, each of the non-executive Directors was appointed by the Government of Western Gold Corporation is managed by a Board of Directors. Part Australia on the nomination of the Treasurer for three-year II (Section 6) of the Gold Corporation Act 1987 empowers terms from 1 July 1996. The term was extended during the Board to determine policies for the Corporation and its 1998-99 for one year, and again in the financial year ended subsidiaries, and requires the Board to: 30 June 2000 for another year. • develop and expand the Corporation’s business; The following Directors are also members of the Board of • operate in accordance with prudent commercial the AGR JV, namely Mr Les McCarrey (Deputy Chairman), principles;and Mr Don Mackay-Coghill and Ms Martine Pop. The other • strive to earn a commercial rate of return on its capital. Directors of the AGR JV are Messrs Rick Lee (Chairman), The Board’s authority is limited by the provisions in the Act Sean Russo and Mike Ryan. Messrs Brian Bath and Richard and by ministerial direction. Hayes are non-voting Directors in their capacity as Managing Director and Deputy Managing Director and The Board is committed to sound corporate governance Financial Director, respectively. principles,high standards of legislative compliance, and financial and ethical behaviour. Directors’ Meetings The Board acknowledges its accountability to the There were eleven meetings of the Directors of Gold 34 Corporation’s only shareholder, the Government of Western Corporation and four meetings of the Directors of the AGR Australia. JV during the year ended 30 June 2000. The number of meetings attended by each Corporation Director is indicated Board Membership below: The Gold Corporation Board comprises executive and non- Director attendance: executive Directors. It has a majority of independent non- executive Directors,including the Chair. Gold Corporation AGR JV L E McCarrey 11 4 Du r ing 1999-2000, the Board consisted of five non-exec u t i v e D Mackay-Coghill 10 4 Di re c t o rs , Mr Les McCarrey, Mr Peter Lalor, Ms Marti n e P K Lalor 9 n/a Pop , Mr Peter Unswor th and the Under Trea s u r er of the J L Langoulant 7 n/a St a te of Wes t e r n Aus t r a l i a , Mr John Langoulant, who was a M D F Pop 11 3 no n - e xe c u t i v e Director ex officio. Mr Don Mackay - C o g h i l l P J Unsworth 11 n/a (Chief Exec u t i v e Officer of Gold Corpo r a tion and Managin g n/a = Not applicable Di r ector of GoldCorp Australia and the Wes t e r n Aus t r a l i a n Mint) was the only exec u t i v e Director of the Board.
Opposite Page: Series 7 Sydney 2000 Olympic gold coin,Achievement (Athlete).
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Achievement (Athlete) Corporate Governance
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Board Committees Credit Committee The Board has established a number of committees, chaired The Credit Committee assists the Board in developing and by non-executive Directors,to assist in the execution of its implementing credit policy, procedures and controls duties,including an Audit Committee, Credit Committee required to ensure the Corporation operates in accordance and Remuneration and Allowances Committee. with prudent commercial principles. Each committee member has only one vote and each The Credit Committee met four times during the year and resolution must be passed by unanimous agreement,except the Committee members were: in the case of the Audit Committee, where decisions are L E McCarrey (Chair) - Non-executive Director taken by majority. In the event that an agreement cannot be A P Melville - Group Accountant and reached,the matter is referred to the Board for resolution. Joint Company Secretary Audit Committee C J Mumme - Manager, Risk Services The Audit Committee advises the Board on the quality, Under the Committee’s voting procedures,each member integrity, reliability and adequacy of the Corporation’s has only one vote and each resolution must be passed information,accounting, and control systems. The unanimously. In the event that unanimity cannot be committee also acts as a communication interface between reached,the matter is referred to the Board for resolution. 36 the Board and the Corporation’s auditors. It comprises The Committee monitors the Group Prudential three members,including a non-executive Director, who Management Policy. The policy deals with all operational acts as Chairperson. and financial risk management issues and insurance The Committee met four times during the year and the compliance matters including Treasury dealing authorities, Committee members were: counter-party risk evaluation,credit application procedures, and credit approval authorities,and ensures that adequate M D F Pop (Chair) - Non-executive Director risk control measures are in place in the Group’s divisions. P J Unsworth - Non-executive Director A P Melville - Group Accountant and Remuneration and Allowances Committee Joint Company Secretary The Board of Directors delegates authority for determining The Committee also actively monitors the group risk conditions of employment to the Remuneration and management program and process to ensure they are Allowances Committee.The Committee’s responsibilities comprehensive, effective and integrated with divisional include determining senior staff salary adjustments, decision making, project management and planning alterations to core conditions of employment and incentive processes. bonus schemes.
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The Remuneration and Allowances Committee consists of The continuing focus on workplace health and safety has two non-executive Directors and the Chief Executive seen a continuation of the favourable trend in lost time Officer. injuries among staff. The rate fell from 11.9 lost time injuries per million hours in 1998-99 to 9.5 in 1999-2000. During 1999-2000,the members of the Committee were: Statistics prior to 1998-99 are not strictly comparable as the L E McCarrey (Chair) - Non-executive Director organisation previously operated a gold refinery and a P K Lalor - Non-executive Director precious metal fabrication plant,which weighted the D Mackay-Coghill - Chief Executive Officer proportion of industrial work performed. Environment Management Committees During the year, the Corporation’s primary environmental Risk Management focus was on the State Battery System,for which Gold Risk management is an important aspect of the Corporation assumed responsibility in 1988. At that time, Corporation’s corporate governance. On a quarterly basis, the State Batteries were operating at a substantial loss and the Board reviews reports on group financial risk,credit and the State Government asked the Corporation to audit committee matters,occupational safety and health, commercialise their operations. Some of the battery sites environmental issues and security. During the year, a quality were vested in Gold Corporation,while others remained vested with other Government departments. review of the risk management process was undertaken to 37 enhance its effectiveness and outcome. After some investigation,it was resolved that the best Occupational Safety and Health solution was to close the operating batteries and to sell the tailings and other assets. This process was completed by the Mr Chris Mumme, Manager, Risk Services,coordinates mid-1990s,although some battery sites were leased to occupational safety and health issues within the Corporation. parties interested in keeping them operational to service the Line management is responsible for occupational safety and small prospector. health at site level.The coordinator’s role is to ensure that In late 1999, env i r onmental and safety concerns wer e raised agreed policies,procedures and standards are implemented in connection with the Northampton State Batt e r y, after a throughout the organisation. No r thampton child was found to have elevated blood lead An occupational safety and health site committee operates le vels resulting from lead tailings used as foundation mate ri a l in the coining department.A site inspection committee for the house in which he was living. Fol l o wing inves t i g at i o n s also operates in the Corporation’s two administration into this issue, the Corpo r a tion funded the rem o val of a buildings,including the national heritage listed building at quantity of apparent concentrates that had been left at the 310 Hay Street. bat t e r y site since the closure of the batt e r y in 1984, an d er ected fences and war ning signs on the site.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Corporate Governance
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Gold Corporation representatives have held meetings with Year 2000 Compliance representatives of the Department of Environmental The Corporation completed its testing and compliance Protection (DEP),the Department of Minerals and Energy program during the first months of the financial year. (DME) and the Department of Land Administration By 1 December, contingency plans were prepared and the (DOLA) in an effort to find a more appropriate Corporation was ready for the Year 2000 date change. management solution for the old State Battery sites. No disruptions to operations were experienced on or after A recent study by the DME provided a priority listing for 1 January 2000. attention,with ranking based on the apparent damage, the GST Compliance number and severity of physical hazards and the proximity to populated areas. Th r oughout the yea r , Gold Corpo r a tion planned the im p l e m e n t a tion of the Goods and Services Tax (GST). Due to It is the view of Gold Corporation,and of all government the complexities of the Corpo r a tion's activities, a GST departments involved,that the most appropriate course of Committee was establi s h e d , with members rep r esenting all of action is to return the management responsibility for the the Corpo r a tion's business area s . The committee met on a sites to DOLA.Rehabilitation of the sites is seen as a ‘whole wee k l y basis and a series of workshops was conducted to train of government’ responsibility.The Corporation has staff on internal proc e d u r es and fam i l i a r ise them with GST. expressed this view to the State Government and is awaiting its response. 38
Top: 2000 Australian Koala Bullion Coin Collection. Opposite Page: Series 8 Sydney 2000 Olympic gold coin,Achievement (Torch).
G O L D C O R P O R A T I O N 2 0 0 0 A N N UA L R E P O R T Achievement (Torch) Performance Indicators
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he mission statement of Gold Corporation is:to provide high quality processing, refining and other services to the gold industry and to T develop and market world-wide,innovative, value-added precious metal products at a commercial rate of return acceptable to the Western Australian Government. Under the Treasurer’s Instructions 904 and 905,a statutory authority is required to provide appropriate output measures and performance indicators in its Annual Report,namely:
• Government desired outcome(s) for each output; • key efficiency indicators for each output, relating outputs to consumed inputs; and • key effectiveness indicators for each outcome, relating outputs to achieved outcomes. Given the above Instructions and taking into account the Corporation’s functions under the Act,its Government desired outcomes are:
• high quality precious metal refining; • value-added precious metal product manufacture and marketing;and • a commercial rate of return on its equity.
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Above: 2000 Australian Kangaroo Nugget Bullion Coin Collection.
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Effectiveness Indicators The key effectiveness indicators for the above outcomes are presented below.
EFFECTIVENESS INDICATO R S
1999-00 1998-99 1997-98 1996-97 1995-96
1 Estimated proportion of Australian fine gold production refined: (Note 1) 31% 40% 58% 55.2% 50.8% 2 Global market share of Australian Nugget gold bullion coin: (Note 2) 6% 5% 11% 16% 16% 3 Coin programs - value added to gold,silver, platinum & palladium: (Note 3) (a) Total premium income: $13.9m $10.1m $8.7m $9.7m $9.8m (b) Total premium income expressed as a percentage of precious metal value: 17.3% 9.3% 7% 8.5% 7.7% 41 4 (a) Return on equity before abnormal items: (Note 4) 12.4 12.0 6.0 3.9 6.4 (b) Return on equity after abnormal items: 12.4 26.4 (6.2) 3.9 6.4 5 Average daily number of visitors to The Perth Mint Shop: (Note 5) 322 309 272 284 276
Notes: 1 The decline in the Corporation’s share of Australian gold production between 1997-98 and 1999-2000 was due to the sale of a 50 per cent share in its Australian Gold Refineries subsidiary in late 1998. The AGR JV’s share of the total Australian fine gold production for the year was 62 per cent. This is based on the AGR JV’s records of gold processed from within Australia and an estimate by the Australian Bureau of Agricultural and Resource Economics of Australian gold mine production of 296.8 tonnes for fiscal 1999-2000. 2 World Gold Council data for calendar 1999. 3 The calculation is the total premium income (amount of income received above metal cost) for all fiscal year Australian legal tender coin sales, which is also expressed as a percentage of the value of the precious metal content of the coins. A significant volume of non-coin precious metal product (eg:medallions and coin blanks) was produced also during fiscal 1999-00. The total premium income (amount of income received above metal cost) earned on these non-coin product sales was $13 million.(1999:$10.5 million) 4 (a) The percentages show Group return on equity at the end of the respective fiscal year, based on the operating result before abnormal items and statutory contribution in lieu of Commonwealth income tax. (b) The percentages show Group return on equity at the end of the respective fiscal year, based on the operating result after abnormal items and before statutory contribution in lieu of Commonwealth income tax. 5 Daily visitor traffic is recorded and the annual number of visitors divided by the number of trading days.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Performance Indicators
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Efficiency Indicators Given the Treasurer’s Instructions and taking into account the Corporation’s functions under the Act, its outputs are: • precious metal refining services; and • precious metal product sales. The key efficiency indicators for the above outputs are presented below:
EFFICIENCY INDICATO R S
1999-00 1998-99 1997-98 1996-97 1995-96
All figures are percentages (except item 3) 1 Trading results as a proportion of sales revenue: (Note 1) 15.9 3.9 3.0 3.8 3.5 2 Expenditure as a proportion of total revenue: (Note 2) 19.2 4.3 3.9 4.7 4.2 42 3 Gold refining cost per ounce expressed as an index: (Note 3) 66 66 68 79 91
Notes: 1 The percentages show the proportion of Group sales revenue represented by the trading result for the respective financial year. The significant change in percentage is due to the restructure of the Group’s business in 1998-99,wherein the refining and industrial products divisions transferred to the AGR JV partnership on 1 December 1998. Income from the partnership is included as a single-line item in the Group Operating Statements. Sales revenue in 1999-2000 is therefore significantly lower than in previous years,with a resultant increase in the efficiency indicator. 2 The percentages show the proportion of Group total revenue – trading and other – represented by total expenditure as shown in the operating statement for the respective financial year. The significant change in percentage is again due to the restructure of the Group’s business,as set out under Note 1. Sales revenue in 1999-2000 is therefore significantly lower than in previous years,with a resultant increase in the efficiency indicator. 3 The cost per ounce is the annual total cost divided by the number of fine ounces of gold refined by the group, expressed as an index with the 1994-95 year indexed as 100.
Opposite Page: Sydney 2000 Olympic Gold Coin Collection.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T
Certification of Performance Indicators
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In our opinion,the performance indicators for Gold Corporation and its subsidiaries contained in this report are based on proper records and fairly represent the performance of the group for the year ended 30 June 2000.
L E McCARREY CMG D MACKAY-COGHILL Chairman Executive Director
1 November, 2000
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G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Opinion of the Auditor General
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To the Parliament of Western Australia GOLD CORPORATION PERFORMANCE INDICATORS FOR THE YEAR ENDED JUNE 30,2000 Scope I have audited the key effectiveness and efficiency performance indicators of Gold Corporation for the year ended June 30,2000 under the provisions of the Financial Administration and Audit Act 1985. The Board is responsible for developing and maintaining proper records and systems for preparing and presenting performance indicators. I have conducted an audit of the key performance indicators in order to express an opinion on them to the Parliament as required by the Act.No opinion is expressed on the output measures of quantity, quality, timeliness and cost. My audit was performed in accordance with section 79 of the Act to form an opinion based on a reasonable level of assurance. The audit procedures included examining, on a test basis, evidence supporting the amounts and other disclosures in the performance indicators,and assessing the relevance and appropriateness of the performance indicators in assisting users to assess the Corporation’s performance.These procedures have been undertaken to form an opinion as to whether, in all material respects,the performance indicators are relevant and appropriate having regard to their purpose and fairly represent the indicated performance. 45 The audit opinion expressed below has been formed on the above basis. Audit Opinion In my opinion, the key effectiveness and efficiency performance indicat o rs of Gold Corp o r ation are re l evant and appro p ri at e for assisting users to assess the Corp o r at i o n ’s performance and fa i r ly re p resent the indicated performance for the year ended June 30, 2 0 0 0 .
D D R PEARSON AUDITOR GENERAL November 13,2000
G O L D C O R P O R A T I O N 2 0 0 0 A N N UA L R E P O R T Certification of Financial Statements
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The accompanying financial statements of Gold Corporation and the accompanying consolidated financial statements have been prepared in compliance with the provisions of the Financial Administration and Audit Act 1985 from proper accounts and records to present fairly the financial transactions for the year ended 30 June 2000,and the financial position as at 30 June 2000. At the date of signing, we are not aware of any circumstances that would render the particulars included in these financial statements misleading or inaccurate.
L E McCARREY CMG D MACKAY-COGHILL A P MELVILLE Chairman Executive Director Principal Accounting Officer
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1 November, 2000
Opposite Page: Sydney 2000 Olympic Silver Coin Collection.
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T Opinion of the Auditor General
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To the Parliament of Western Australia GOLD CORPORATION FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30,2000 Scope I have audited the accounts and financial statements of Gold Corporation for the year ended June 30,2000 under the provisions of the Financial Administration and Audit Act 1985.The financial statements include the consolidated accounts of the consolidated entity comprising the Corporation and the entities it controlled at the year’s end or from time to time during the financial year. The Board is responsible for keeping proper accounts and maintaining adequate systems of internal control,preparing and presenting the financial statements,and complying with the Act and other relevant written law.The primary responsibility for the detection,investigation and prevention of irregularities rests with the Board. My audit was performed in accordance with section 79 of the Act to form an opinion based on a reasonable level of assurance.The audit procedures included examining, on a test basis,the controls exercised by the Corporation to ensure financial regularity in accordance with legislative provisions, evidence to provide reasonable assurance that the amounts and other disclosures in the financial statements are free of material misstatement and the evaluation of accounting policies and significant accounting estimates.These procedures have been undertaken to form an opinion as to whether, in all material respects,the financial 48 statements are presented fairly in accordance with Accounting Standards,other mandatory professional reporting requirements and the Treasurer’s Instructions so as to present a view which is consistent with my understanding of the Corporation’s and the consolidated entity's financial position,the results of their operations and their cash flows. The audit opinion expressed below has been formed on the above basis. Audit Opinion In my opinion, (i) the controls exercised by Gold Corporation provide reasonable assurance that the receipt,expenditure and investment of moneys and the acquisition and disposal of property and the incurring of liabilities have been in accordance with legislative provisions;and (ii) the Operating Statement,Statement of Financial Position and Statement of Cash Flows of the Corporation and the Consolidated Operating Statement,Consolidated Statement of Financial Position and Consolidated Statement of Cash Flows of the consolidated entity and the Notes to and forming part of the financial statements are based on proper accounts and present fairly in accordance with applicable Accounting Standards,other mandatory professional reporting requirements and the Treasurer’s Instructions,the financial position of the Corporation and the consolidated entity at June 30,2000 and the results of their operations and their cash flows for the year then ended.
D D R PEARSON AUDITOR GENERAL November 13,2000
G O L D C O R P O R A T I O N 2 0 0 0 A N N U A L R E P O R T